UPDATE: Citigroup Downgrades Sunoco to Neutral Following Acquisition by ETP

Citigroup reduced its rating on Sunoco

from Buy to Neutral, both High Risk, and lowered its price target from $55 to $51. Citigroup noted, "The background discussion on the merger in the S-4 and the upcoming close of the transaction make a competing bid unlikely. Since the deal was announced on 4/30/12, the performance of SUN's assets has exceeded our expectations. A resurgence in refining margins in the Atlantic basin, strong retail margins and a growing pipeline and logistics business have all strengthened the health of the company ahead of the close of the merger. We are reducing our target price to our previous fundamental valuation, which excludes synergies." Sunoco closed at $47.67 on Thursday.